Anheuser-Busch InBev is making a bold move into China, the largest and most elusive prize

ZIYANG, China—Little of the Western world has infiltrated this dusty city in China's rural hinterland, where red lanterns hang from lampposts and restaurants serve pig tail and duck neck. But Americans would recognize a beer increasingly making the rounds here: Budweiser, which flows from a state-of-the-art brewery built below a hilltop pagoda.

Advertisements for the 137-year-old brand from St. Louis, Mo., drape the windows of a banquet hall, trumpeting the year of the snake. The walls, floors and stairs of a karaoke bar...